Xbox One X Isn’t For Everyone, and the Head of Xbox Knows It

The Xbox One X is dropping on November 7th. The amped-up version of the Xbox One will be the most powerful console yet. All those specs come at a price, though; it will cost $500 in the United States. It’s worth noting that was the exact same price of the original Xbox One when it hit shelves back in 2013, although the motion-tracking Kinect sensor was bundled in and there was nothing anyone (including myself) could do about it.

Analysts and consumers alike are skeptical of the consoles ability to move units at that price point. It’s a concern that’s actually recognized by Phil Spencer, the head of Xbox. In a recent interview with Gamespot, Spencer said once again that the lower tier Xbox One S would continue to be the brand’s top-seller of the generation.

“Xbox One S will be the market leader for us. It’s the more affordable console. It plays all the same games, it will be the console that sells.”

While the Xbox One S is for everyone, Spencer said that the Xbox One X still had a market to serve. For people that want the very best, regardless of price, the Xbox One X is the obvious choice. It’s not so much about new functionality as it is improved functionality. In theory, games can run at higher settings, load times can be faster, etc.

Personally I see a bit of a chicken and egg situation for the Xbox One X as it relates to game developers. While certain things will perform better out of the box, developers need to actively build their games in a way that scales for the better hardware to take full advantage of it and for consumers to see the fullest results. The only real incentive for that is to have a large audience using the better hardware. The paradox here is that if there aren’t enough games where huge results can be seen, consumer interest in the upgrade will be lower, which causes the interest from developers to create those results to also be lower.

There are two main parallels I’d like to point out here. The first is between consoles and their gaming hardware cousin, the PC. The PC gaming market has been experiencing this type of thing for a very long time. PC gamers that want the very best get the very best hardware, and with the PS4 Pro and in just a few weeks the Xbox One X, it seems like the console market is moving in that direction as well. The problem I have with this business model as it relates to consoles is that I see the Venn diagram intersection between people that want the very best, and the people that aren’t willing to just get a PC (where the actual very best can be found) being very small. Numbers are still coming in on the PS4 Pro and we’ll have to wait and see with the Xbox One X, but both of these consoles require a market of gamers that strike the perfect balance between casual and hardcore that they’re looking for, and I’m just not sure how many of those people are actually out there.

Perhaps the point is not mass market success, though. Certainly if console makers correctly anticipate demand, even if it’s on the lower end, they can increase their bottom line regardless of sales volume. I see Xbox being late to the party as an advantage here, because they’re able to use their closest competitor, the PS4 Pro, to get a more accurate idea of how many units they should produce.

The second parallel is between the Xbox One X and the Xbox One from 2013 (the one with the bundled Kinect sitting in a drawer that I’m still upset about). That console cost $500, and for a very short time it was impossible to use the console without Kinect. There are certainly people that love their Kinects and had no problem with them being bundled in, but there’s a reason Xbox bailed on the idea. The Xbox One X is less divisive because more hardware power is not controversial, it’s always desirable, but there is likely to be a similar effect here as it’s still a niche market. All-in-all, if the Xbox One X was the only offering from the company this generation, it could have been as bad an idea as the Kinect strategy — but it’s not. This time around, Xbox is doing things right. They’re giving people the choice.

And props to Phil Spencer for not overselling.